Thoughts

The U.S. Dollar is being firmly capped by its resistance zone. Bearish.

Oil is in a consolidation pattern and the smart money is very bearish.

4pm Gold and silver: a medium term bullish sign

Gold and silver were flat today even though the U.S. dollar surged. This is a medium term bullish sign for precious metals because there has been an inverse relationship between gold/silver and the USD.

Gold and silver are waiting for the U.S. Dollar’s bounce to be over before they can start a meaningful rally. The USD has yet to breakdown.

3 am: The U.S. Dollar is being firmly capped by its resistance zone. Bearish.

As expected, the U.S. Dollar was capped by its 50 daily moving average. It is also capped by 91, which is previous-support that has now been turned into resistance.

The U.S. Dollar’s bear market is still completely intact.

3 am: Oil is in a consolidation pattern and the smart money is very bearish.

Oil is swinging sideways in a consolidation pattern that’s becoming more and more narrow. We can expect a breakout or breakdown purely from a pattern perspective.

This is happening just as the commercial hedgers (“smart money”) are becoming more and more bearish on oil.

I think oil will make a bigger correction. Only a bigger correction will decrease the record short position that commercial hedgers are holding in oil.

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